The Feral Bureau of Investigation (FBI) on January 19, 2012 released the following:

“Ten Individuals Arrested for Health Care Fraud

SAN JUAN, PR—On January 12, 2012, a federal grand jury returned two indictments against 10 individuals for conspiracy to commit health care fraud, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. The investigation was led by the Department of Health and Human Services, Office of the Inspector General (HHS-OIG), with the collaboration of the United States Secret Service (USSS) and the Federal Bureau of Investigation (FBI).

The indictment alleges that from on or about November, 2008, until on or about May, 2010, Monte Mar submitted at least 1,518 false and fraudulent claims to Medicare totaling approximately $2,993,127.35 for Durable Medical Equipment (DME) that was not medically necessary, causing Medicare to disburse approximately $1,440,597.65. In March 2010, the indictment further alleges that after Monte Mar had been placed in a pre-payment status by Medicare, defendants Gilberto Gómez and Yolanda García-Rodríguez purchased PROMEDS and submitted false claims to Medicare seeking reimbursement for DME, including power wheelchairs, power pressure reducing air mattresses and knee orthosis. PROMEDS submitted at least 359 fraudulent claims to Medicare totaling approximately $786,368.34, causing Medicare to disburse approximately $335,493.12. In October 2010, the indictment alleges that a third company, Quality, was purchased by Gómez and García-Rodríguez after PROMEDS had been placed in a pre-payment status by Medicare. From on or about October 2010, until May, 2011, Quality submitted at least 115 false claims to Medicare totaling approximately $298,321.26, causing Medicare to disburse approximately $180,659.77. The indictment alleges a total amount of $4,077,816.95 fraudulently billed by using Monte Mar, PROMEDS and Quality, where Medicare disbursed a total of approximately $1,956,750.54.

Doctor Francisco Garrastegui was a physician licensed to practice medicine in Puerto Rico but not a Medicare provider. Garrastegui signed and completed false progress notes, prescriptions, Certificate of Medical Necessity (CMNs) and Statements of Ordering Physician for Medicare beneficiaries that were billed by Monte Mar, PROMEDS and Quality. The doctor was paid kickbacks by the three health corporations for the preparation of these false documents. The other defendants’ participation during the conspiracy involved the creation and submission of the fraudulent claims to Medicare.

The health care fraud scheme charged in the second indictment involves Luz M. Vega, president of Preferred Medical Equipment (PME), Doctor Francisco Garrastegui, Lissette Acevedo, Luisa Nieves and María Elisa Pérez. According to the 60-count indictment, from on or about April 2010, until on or about March 2011, PME submitted false claims to Medicare, seeking reimbursement for Durable Medical Equipment including: power wheelchairs, power pressure reducing air mattresses, wheelchair accessories, lumbar-sacral orthosis, knee orthosis and hospital beds. The co-conspirators submitted at least 95 fraudulent claims totaling approximately $210,223.47, causing Medicare to disburse approximately $107,876.73. Defendants Garrastegui, Acevedo and Nieves also participated in the first conspiracy charged in the previously mentioned indictment. The government seeks to forfeit $107,876.73 and one bank account.

“As part of the nation’s health care system, Medicare serves vulnerable populations,” said United States Attorney, Rosa Emilia Rodríguez-Vélez. “Today’s arrests by HHS-OIG agents and our law enforcement partners show that we will not tolerate criminals who engage in fraudulent schemes which deplete the Medicare program of funds which are destined for our elderly population, in order to enrich themselves.”

“HHS/OIG works diligently to investigate allegations of Medicare fraud. Today’s arrests involving durable medical equipment (DME) fraud demonstrate our resolve to bring these subjects to justice. Furthermore, as seen on the attached chart (DME data), our efforts, along with the U.S. Attorney’s Office and our law enforcement partners, have made a dramatic reduction on the total dollars billed and paid for DME in Puerto Rico.”

“The U.S. Secret Service is committed to investigate any financial fraud crimes to include identity theft along with our partner agencies to safeguard our financial system,” said Pedro Gómez, Special Agent in Charge. We will continue to investigate these types of crimes to the fullest extent of the law and bring to justice these criminals that engage in identity theft to facilitate other criminal activities.”

HHS-OIG, USSS, and the FBI conducted the investigations. The agencies that conducted the arrests were HHS-OIG, USSS, FBI, and the U.S. Marshal Service.

The cases are being prosecuted by Assistant U.S. Attorneys Julia Díaz-Rex, health care fraud coordinator, and Héctor Ramírez-Carbó, and Special Assistant U.S. Attorney Wallace A. Bustelo.

If found guilty, the defendants could face a possible sentence of 10 years in prison for the health care fraud offense with a consecutive term of imprisonment of two years for the aggravated identity theft offense and a fine of up to $250,000. Indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent unless and until proven guilty.”

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.